You estimate the economy will be really booming next year, Financial Management

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You estimate the economy will be really booming next year

You estimate the economy will be really booming next year with 30% probability, and normal with 70% probability. Your analysis of an airline company suggests that the company stock will return 15% if the economy booms, and only 6% if the economy is normal. What is the standard deviation of this stock’s return?

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Financial Management: You estimate the economy will be really booming next year

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